Quality improvement for asthma care: The asthma care return-on-investment calculator Ginger Smith Carls, M.A., Thomson Healthcare (Medstat) State Healthcare Quality Improvement Workshop: Tools You Can Use to Make a Difference December 6-7, 2007

2 Agenda What is the Asthma Care Return-on-Investment calculator? What is the Asthma Care Return-on-Investment calculator? Background Background – Definitions – Key issues – How can the calculator help evaluate asthma care programs? What does it provide? How does the calculator work? How does the calculator work? Features of the calculator Features of the calculator Summary of literature review Summary of literature review Conclusions Conclusions Resources Resources

3 What is the Asthma Care ROI Calculator? Purpose Purpose – Help state policy makers and health plans estimate financial returns asthma quality improvement programs Why developed? Why developed? – Most studies don’t address financial impact, rather clinical and use impacts only – Clinical or use impacts need to be translated into costs or savings How are estimates generated? How are estimates generated? – Combine clinical evidence about impacts on utilization with separate cost data to estimate financial impact

4 Background: definitions Asthma care programs typically follow NAEPP (National Asthma Education and Prevention Program) guidelines Patient education Provider activities Financial metrics Return on Investment (ROI) = Savings Program Cost = $1 break-even Net Present Value (NPV) = Savings – Program Cost = $0 break-even

5 Background: cost vs. quality Programs that improve quality of asthma care may or may not reduce total medical care costs Programs that improve quality of asthma care may or may not reduce total medical care costs + = RX

6 Background: program evaluation methods Regression to the mean bias Regression to the mean bias – Sick patients may get better over time, even without the program – To be successful, a program must “beat” the regression to the mean bias Program cohort Control Cohort 60% 20% True effect of program = 40%

7 How does the calculator work? 72,777 participants who average 0.25 ED visits per year 18,194 annual visits to ER Asthma program 30% 5,458 visits to ER saved Each visit costs $88 $480,304 saved Repeat for each component asthma-related costs Compare change in medical care expenditures with program cost

8 How does the calculator work? Cost components Asthma-related medical care Asthma-related medical care – Emergency department visits – Hospital stays – Outpatient visits – Medications – Ancillary testing Productivity Productivity – Missed school or work days

9 Data sources 1. Population demographics – Medicaid (CMS 2003) – Employer sponsored health insurance (CPS ) - State employees (BLS ) 2. Large, nationwide, medical claims database (MarketScan TM ) – Prevalence rates – Utilization and costs for asthma patients 3. Literature review (52 studies) – Impact of asthma care programs – Cost to implement asthma care programs 4. You! – Virtually all data used by the model can be changed by the user

10 Calculator features Ability to examine how the following factors may change financial impact of program Ability to examine how the following factors may change financial impact of program – Who is included in the program Children, adults, or both All asthma patients, or only those with persistent asthma Medicaid, employer-sponsored insurance, or state employees – What benefits are counted? Only medical care savings or also include productivity gains? – Length of the program – Cost to implement the program Options to describe benefits and costs from a third-party payer or society perspective. Options to describe benefits and costs from a third-party payer or society perspective.

11 Calculator features Ability to choose the research design to use in estimating savings Ability to choose the research design to use in estimating savings – Studies without a control group Use as a benchmark for preliminary results Use as a benchmark for preliminary results – Studies with a control group shows expected true savings shows expected true savings – Comparisons between study designs can be used to assess magnitude of regression to the mean bias Use calculator in planning, monitoring and/or evaluative phases of an asthma care program

12 Steps in the ROI calculator participants Estimate number of participants baseline Estimate baseline utilization or missed work days impact Estimate impact of the asthma program ROI User choices about asthma program Default or user data program cost Estimate program cost population Describe population Meta-analysis

13 Results from the literature review Savings more likely for some populations than others, depending on the component of care. For example: Interventions on people with persistent asthma (versus all asthma) had: Interventions on people with persistent asthma (versus all asthma) had: – Higher savings on ED visits and outpatient visits – Similar savings on missed work/school days – Lower savings on hospitalizations – Smaller increases in medication costs (so higher savings)

14 Results from the literature review Interventions on Medicaid populations (versus other coverage) had: Interventions on Medicaid populations (versus other coverage) had: – Higher savings on hospitalizations, outpatient visits, missed work/school days – Lower savings on ED visits Interventions on children (versus adults) had: Interventions on children (versus adults) had: – Higher savings on outpatient visits and asthma medications – Lower savings on ED visits, hospitalizations, and missed work/school days Controlled studies showed lower savings than non-controlled studies Controlled studies showed lower savings than non-controlled studies

15 Results from literature Few studies reported program cost; those that did reported a wide range (7 studies) Few studies reported program cost; those that did reported a wide range (7 studies) – Average of $395 dollars per patient per year – Low of $81 for automated educational mailing to general populations – High of $989 per year, targeted to highest cost patients

16 Results from literature Few studies reported the impact on asthma medication use (10 studies) Few studies reported the impact on asthma medication use (10 studies) – Studies without a control group reported larger increases in medication costs – Studies with a control group reported smaller increases in medication costs – Baseline asthma medication costs varied a great deal, suggesting different cost and utilization settings – Recent increase in use of drug formularies and availability of generics may result in lower increases in medication cost than reported by some of the older studies included in our review

17 Conclusions Programs that… Target patients who use the emergency department and hospital for asthma care Target patients who use the emergency department and hospital for asthma care Target children Target children Target Medicaid program Target Medicaid program What kinds of programs are more likely to find savings?

18 Conclusions Decrease in costs due to hospitalizations Decrease in costs due to hospitalizations Increase in medication use Increase in medication use Cost to implement the program Cost to implement the program What are the key drivers of ROI?

19 What can the asthma care calculator do? Help plan, monitor and evaluate financial impact of asthma care programs Help plan, monitor and evaluate financial impact of asthma care programs Summarizes published evidence on financial impact of asthma care programs Summarizes published evidence on financial impact of asthma care programs Conclusions

20 Resources Breakout sessions Breakout sessions – Policy implications – Hands-on-Training Handouts Handouts – Screen shots example Detailed report available on request Detailed report available on request – Documents methods, definitions used for the default baseline data – List of studies included in the literature review Send questions, suggestions and stories about the use of the calculator to: Send questions, suggestions and stories about the use of the calculator to: Ginger Carls or Rosanna Coffey